India's support has been critical in combating Sri Lanka's meltdown, says Colombo-based author Srimal Fernando


Recent photograph of United National Party leader Ranil Wickremesinghe taking over as the Prime Minister of Sri Lanka (Photo: ANI)

From a thriving economy with the highest human development indicators in South Asia at one time, Sri Lanka has slipped considerably over the past one year. With a new government in place, led by the Prime Minister Ranil Wickremesinghe, who also became its Finance Minster just two days back, the world's eyes are on the island nation. 

India Narrative speaks with Dr Srimal Fernando, Colombo-based international affairs advisor on New Regional Diplomacy, about the direction the new government is taking, India's big brother image and how Wickremesinghe plans to steer the country out of its worst-ever financial crisis.

Sri Lankan author and international affairs advisor on New Regional Diplomacy, Dr Srimal Fernando (Photo: Twitter)

Excerpts from the interview:

Q: India seems to have sent considerable foreign aid to Sri Lanka over the past few months. How do the people view this support, or are they still suspicious of the big neighbour?

Fernando: Well, people might have harboured suspicion about India when Sri Lanka was stable. Now the reality is that it was only India who provided support, nobody else did. 

The government had requested traditional powers for aid but none responded.

India has extended a line of credit of $2 billion under the Neighbourhood First policy with another US$ 1.5 billion of support to Sri Lanka in the past few months. A lot of this aid is catering to people who are vulnerable and are from the lower economic strata. People appreciated the food and the dal that was sent by India.

I think Indian help has brought stability to the political set-up and somewhere it also helped in maintaining the security of Sri Lanka. Oil sent by India also helped us considerably. In the last 2-3 months the public has appreciated India's sincere help.

Because of its influence, India has the capacity to convince the IMF and other donors. The Indian Finance Minister had put in a word at the IMF in Washington when our previous Finance Minister Aly Sabry was talking to IMF for aid.

Q: How do you see Mr Ranil Wickremesinghe's appointment as the Finance Minister? Do you think this will send the right signals to international donors?

Fernando: The Prime Minister plans to present an interim budget in six weeks. He will create a proper roadmap that takes the country out of the current situation. The budget is likely to slash down on infrastructure projects--expressways and roadways that are expensive and are not needed right now.

Wickremesinghe also plans to recruit new advisors who will draft a proposal for the International Monetary Fund (IMF).

He will try to give something to the lower middle class and the vulnerable people. He also plans to cut down on unnecessary government expenditure.

Currently the government does not have the rupee revenue, therefore, to maintain a stable economy, it the government needs to print one trillion Sri Lankan rupees. I think Wickremesinghe is trying his level best to run the country in a chaotic situation--the financial crisis, Mahinda Rajapaksa's resignation, the emergency and people's suffering.

Q: Has there been any progress in Sri Lanka over humanitarian aid and long-term support to the country after Wickremesinghe took over as the Prime Minister?

Fernando: The situation has been very bad. There was a wave of problems when Wickremesinghe took over as the Prime Minister. The number of protestors was increasing by the day and the situation had turned violent.

Now government departments are being managed. There has been a bit of stability since he took over. There is clarity in running the government.

There is a plan. The Prime Minister has already appealed to the international community for donations. The common man is frustrated but people now think that the new prime minister will change things. Simultaneously, many people are unhappy that Wickremesinghe is with the old government of the Rajapaksas.

Q: Why do the "Gota Go Gama' protestors want President Rajapaksa to quit even after the far-reaching changes in the government?

Fernando: You see initially, both--the people and the opposition parties wanted then prime minister Mahinda Rajapaksa and the government to quit because of the financial mismanagement and the crisis in the country. That has already happened.

The protestors and the main opposition parties also want the President to resign.

They are demanding changes in the powers of the President. They want the 21st amendment to the Constitution to be carried out so that the wide-ranging presidential powers can be curtailed. This is something that not just the opposition parties want, but even the breakaway groups of the government want--that the presidential powers should be reduced.

The protestors are angry over corruption--they are going to the offices of the police, asking them to arrest the corrupt people. The protestors also want the money earned through corruption to be brought back and the corrupt politicians to be jailed.

Q: How are people at the grassroots level coping with the scarcity of food and fuel?

Fernando: Our situation is somewhat like that of Zimbabwe.

Inflation has crossed 33 per cent. Food prices have gone up by around 50 per cent. The cost of living has gone up substantially. There are no essential drugs. People are having a tough time due to little power, little gas, 6-7 hour queues for fuel.

Sri Lanka has essentially been a welfare State. We had free education, free healthcare and subsidised transport. However, our food and fuel have to be imported. Because of the issue of fertiliser last year, our food production fell because of which we face food shortage.

We need a reforms based approach--where we first address the needs of the vulnerable people rather than cushioning the rich people. I think there is hope among the people.

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